Stocks Have Reached the Euphoria Stage

The last bull ended when the leading stock, GOOG, entered a parabolic "bubble" phase.
That was the signal that the bull had reached the euphoria stage. When the
GOOG bubble popped it signaled the end of the bull market.

Two stocks, AAPL and PCLN, have been the leaders of this bull market. Both
have entered the euphoric "bubble" stage. When the Apple and Priceline parabolas
break it will almost certainly signal the end of this bull market.

Apple is now stretched 49% above the 200 day moving average. Anything between
50 and 60% above the mean is extreme dangerous territory.

As I pointed out in my last article the dollar is beginning its second daily
cycle up in what could very well be a cyclical bull market. This should correspond
with the stock market topping and the next leg down in the secular bear market.

My best guess is that we will see a sharp selloff over the next 2 to 3 weeks,
followed by a sharp rebound (QE3) that may, or may not, move stocks to marginal
new highs, similar to the 2007 top.

The poor employment report on Friday is the first warning shot across the
bow that the economy is slowing in preparation for moving down into the next
recession/depression.

Bernanke is in the same position he was in 2007. Printing more money won't
stop the collapse. It will only continue to spike the price of energy and exacerbate
the decline.

Gold Scents is a financial
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